Mercury EV-Tech Faces Market Challenges Despite Surge in Sales and Profit Growth

Mercury EV-Tech, a microcap player in the automobile industry, has experienced significant volatility today, hitting a new 52-week low of Rs. 48.6. The stock has underperformed its sector by 0.84% and has seen a consecutive decline over the past week, with a total drop of 7.43%. Currently, it is trading below its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages, indicating a challenging market position.
In the broader market context, the Sensex has also faced downward pressure, falling by 291.41 points to 81,774.35, reflecting a negative sentiment across the board. Over the past year, Mercury EV-Tech's performance has been notably poor, with a decline of 31.59%, contrasting sharply with the Sensex's modest gain of 2.17%.

Despite these challenges, the company has reported impressive growth in net sales, which surged by 553% in the latest six months, alongside a remarkable 667.11% increase in profit after tax. However, the high Debt to EBITDA ratio of 9.32 times raises concerns about its ability to service debt, while a low Return on Equity of 2.73% suggests limited profitability.